[526]*526STUMBO, Justice.
Appellant, Corliss Howard, challenges a decision of the Court of Appeals reversing a Shelby Circuit Court judgment compelling Appellee, Motorists Mutual Insurance Company (“Motorists”), to provide insurance coverage for a 1991 auto accident. This opinion addresses whether estoppel or waiver can, under certain circumstances, preclude an insurance company from denying coverage after it has cashed an insured’s cheek and retained the funds.
On April 29,1989, Appellant contacted Ap-pellee, Doetrow-Rieh Insurance Agency (“Doetrow”), an independent insurance agency, to obtain automobile liability insurance. After an initial rejection, Motorists issued Appellant an insurance policy. Over the next year-and-a-half, Motorists continued to insure Appellant, even though she often sent in late payments and, in two instances, actually let her insurance lapse.
On December 17, 1990, Motorists sent Appellant a renewal billing statement indicating it would renew her auto insurance policy until July 19, 1991, if it received a renewal payment by January 18,1991. Appellant did not forward a payment by the expiration date and, on January 29, 1991, Motorists sent Appellant a letter advising her to contact her agent to “discuss her insurance needs.” Appellant did so, stopping by Doctrow’s office on February 3. Doetrow did not accept Appellant’s tendered payment on Motorists’ behalf, as he had sometimes done in the past. Instead, the agent told her to forward the payment directly to Motorists. Appellant mailed a check for $126.94 to Motorists on February 5. Upon receipt on February 7, Motorists cashed the.check, deposited Appellant’s premium payment and issued her a receipt with policy number.
On February 19, 1991, pursuant to an internal policy regarding frequent policy lapses, an underwriter at Motorists sent a letter, along with a refund of Appellant’s premium payment, to Doetrow. Doetrow received the. notice and check on February 22 and forwarded it to Appellant that same day. Unfortunately, Appellant had an auto accident on February 22. The driver and passenger in the other vehicle, Appellees George Terry and Timothy Waxier, sued Appellant. Motorists refused to extend coverage or defend Appellant in the action. As a result, Appellant filed a third-party complaint against both Motorists and Doetrow.
The Shelby Circuit Court entered summary judgment in favor of Appellant on the coverage issue, requiring Motorists to defend Appellant and provide coverage for any losses. Since Motorists had a duty to cover the loss, the trial court dismissed Appellant’s action against Doetrow, the independent agent, as moot. Motorists appealed, and Appellant filed a cross-appeal regarding the dismissal of her action against Doetrow. The Court of Appeals reversed, rejecting Appellant’s estoppel argument and holding that the cashing of Appellant’s check did not create a contract of insurance. We granted Appellant’s request for discretionary review and now reverse.
Citing past dealings between the two, Appellant contends that, by cashing her check and issuing her a receipt, the insurance company has either waived its right to deny coverage or is estopped from doing so. In response, Motorists contends that Appellant’s policy had lapsed, and that under Troutman v. Nationwide Mut. Ins. Co., Ky., 400 S.W.2d 215 (1966), the mere cashing of a premium check does not create a contract of insurance. After considering the arguments of both parties, under the peculiar facts of this case, we must agree with Appellant.
Because Appellant asserts a mixed bag of arguments implicating both waiver and estoppel, the Case of Edmondson v. Pennsylvania Nat’l Mut. Casualty Ins. Co., Ky., 781 S.W.2d 753 (1989), is instructive. “Waiver and estoppel, as applied to contracts of insurance, are terms often used interchangeably, but this obscures their meaning.” Id. at 755. The two are separate and distinct concepts. Waiver, we have said, is “bottomed on a voluntary and intentional relinquishment of a known, existing right or power under the terms of an insurance contract.” Id. (quoting Long, The Law of Liability Insurance § 17.14).. After an internal review, Motorists refunded Appellant’s premium. While Motorists’ untimely refund of [527]*527Appellant’s premium might be attributable to flawed procedures, we cannot characterize it as the kind of intentional act that establishes a waiver. Motorists did not intend to waive its right to refuse to renew Appellant’s coverage, nor its right not to issue her a new policy. Instead, it is not unfair to say that Motorists simply failed to act. Thus, as defined by Edmondson, the doctrine of waiver does not apply here. If Appellant is to prevail, she must do so using estoppel.
According to Edmondson, estoppel “offsets misleading conduct, acts, or representations which have induced a person to rely thereon to change his position to his detriment.” Id. (quoting Long, The Law of Liability Insurance § 17.14). Gray v. Jackson Purchase Credit Ass’n, Ky.App., 691 S.W.2d 904 (1985), sets forth the elements of estoppel:
(1) Conduct, including acts, language and silence, amounting to a representation or concealment of material facts; (2) the es-topped party is aware of these facts; (3) these facts are unknown to the other party; (4) the estopped party must act with the intention or expectation his conduct will be acted upon; and (5) the other party in fact relied upon this conduct to his detriment.
Id. at 906. Applying this test to the case at bar, we hold that Motorists is estopped from denying coverage.
We first examine the element of Motorists’ conduct. Because the facts of this ease are extremely important in reaching our result, we will set them forth in some detail. As noted, Appellant and Motorists began their business relationship in 1989. The two generally contracted for a six-month period of coverage, payable in two installments, one at the beginning of coverage and one three months later. From the beginning of the relationship until the February 22,1991, auto accident, Motorists twice allowed Appellant to tender late installment payments and nonetheless continue her insurance coverage. In September of 1989, Motorists accepted Appellant’s second installment over a month after the due date. After receiving the payment, Motorists issued Appellant an endorsement making the policy effective from the date the premium had been due; in other words, the late payment operated retroactively to keep the existing policy in force. In April of 1990, Appellant again sent in the second installment of her premium over a week after the due date, and again Motorists accepted the payment and applied it retroactively, continuing her coverage from the payment’s due date.
Motorists points out that, in the instant situation, Appellant did not merely miss an installment payment and instead had let her auto insurance lapse. Even when Appellant allowed her policy to lapse completely, however, Motorists continued to accept her premium payments and issue retroactive insurance coverage. For instance, Appellant’s policy lapsed in December of 1989.
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[526]*526STUMBO, Justice.
Appellant, Corliss Howard, challenges a decision of the Court of Appeals reversing a Shelby Circuit Court judgment compelling Appellee, Motorists Mutual Insurance Company (“Motorists”), to provide insurance coverage for a 1991 auto accident. This opinion addresses whether estoppel or waiver can, under certain circumstances, preclude an insurance company from denying coverage after it has cashed an insured’s cheek and retained the funds.
On April 29,1989, Appellant contacted Ap-pellee, Doetrow-Rieh Insurance Agency (“Doetrow”), an independent insurance agency, to obtain automobile liability insurance. After an initial rejection, Motorists issued Appellant an insurance policy. Over the next year-and-a-half, Motorists continued to insure Appellant, even though she often sent in late payments and, in two instances, actually let her insurance lapse.
On December 17, 1990, Motorists sent Appellant a renewal billing statement indicating it would renew her auto insurance policy until July 19, 1991, if it received a renewal payment by January 18,1991. Appellant did not forward a payment by the expiration date and, on January 29, 1991, Motorists sent Appellant a letter advising her to contact her agent to “discuss her insurance needs.” Appellant did so, stopping by Doctrow’s office on February 3. Doetrow did not accept Appellant’s tendered payment on Motorists’ behalf, as he had sometimes done in the past. Instead, the agent told her to forward the payment directly to Motorists. Appellant mailed a check for $126.94 to Motorists on February 5. Upon receipt on February 7, Motorists cashed the.check, deposited Appellant’s premium payment and issued her a receipt with policy number.
On February 19, 1991, pursuant to an internal policy regarding frequent policy lapses, an underwriter at Motorists sent a letter, along with a refund of Appellant’s premium payment, to Doetrow. Doetrow received the. notice and check on February 22 and forwarded it to Appellant that same day. Unfortunately, Appellant had an auto accident on February 22. The driver and passenger in the other vehicle, Appellees George Terry and Timothy Waxier, sued Appellant. Motorists refused to extend coverage or defend Appellant in the action. As a result, Appellant filed a third-party complaint against both Motorists and Doetrow.
The Shelby Circuit Court entered summary judgment in favor of Appellant on the coverage issue, requiring Motorists to defend Appellant and provide coverage for any losses. Since Motorists had a duty to cover the loss, the trial court dismissed Appellant’s action against Doetrow, the independent agent, as moot. Motorists appealed, and Appellant filed a cross-appeal regarding the dismissal of her action against Doetrow. The Court of Appeals reversed, rejecting Appellant’s estoppel argument and holding that the cashing of Appellant’s check did not create a contract of insurance. We granted Appellant’s request for discretionary review and now reverse.
Citing past dealings between the two, Appellant contends that, by cashing her check and issuing her a receipt, the insurance company has either waived its right to deny coverage or is estopped from doing so. In response, Motorists contends that Appellant’s policy had lapsed, and that under Troutman v. Nationwide Mut. Ins. Co., Ky., 400 S.W.2d 215 (1966), the mere cashing of a premium check does not create a contract of insurance. After considering the arguments of both parties, under the peculiar facts of this case, we must agree with Appellant.
Because Appellant asserts a mixed bag of arguments implicating both waiver and estoppel, the Case of Edmondson v. Pennsylvania Nat’l Mut. Casualty Ins. Co., Ky., 781 S.W.2d 753 (1989), is instructive. “Waiver and estoppel, as applied to contracts of insurance, are terms often used interchangeably, but this obscures their meaning.” Id. at 755. The two are separate and distinct concepts. Waiver, we have said, is “bottomed on a voluntary and intentional relinquishment of a known, existing right or power under the terms of an insurance contract.” Id. (quoting Long, The Law of Liability Insurance § 17.14).. After an internal review, Motorists refunded Appellant’s premium. While Motorists’ untimely refund of [527]*527Appellant’s premium might be attributable to flawed procedures, we cannot characterize it as the kind of intentional act that establishes a waiver. Motorists did not intend to waive its right to refuse to renew Appellant’s coverage, nor its right not to issue her a new policy. Instead, it is not unfair to say that Motorists simply failed to act. Thus, as defined by Edmondson, the doctrine of waiver does not apply here. If Appellant is to prevail, she must do so using estoppel.
According to Edmondson, estoppel “offsets misleading conduct, acts, or representations which have induced a person to rely thereon to change his position to his detriment.” Id. (quoting Long, The Law of Liability Insurance § 17.14). Gray v. Jackson Purchase Credit Ass’n, Ky.App., 691 S.W.2d 904 (1985), sets forth the elements of estoppel:
(1) Conduct, including acts, language and silence, amounting to a representation or concealment of material facts; (2) the es-topped party is aware of these facts; (3) these facts are unknown to the other party; (4) the estopped party must act with the intention or expectation his conduct will be acted upon; and (5) the other party in fact relied upon this conduct to his detriment.
Id. at 906. Applying this test to the case at bar, we hold that Motorists is estopped from denying coverage.
We first examine the element of Motorists’ conduct. Because the facts of this ease are extremely important in reaching our result, we will set them forth in some detail. As noted, Appellant and Motorists began their business relationship in 1989. The two generally contracted for a six-month period of coverage, payable in two installments, one at the beginning of coverage and one three months later. From the beginning of the relationship until the February 22,1991, auto accident, Motorists twice allowed Appellant to tender late installment payments and nonetheless continue her insurance coverage. In September of 1989, Motorists accepted Appellant’s second installment over a month after the due date. After receiving the payment, Motorists issued Appellant an endorsement making the policy effective from the date the premium had been due; in other words, the late payment operated retroactively to keep the existing policy in force. In April of 1990, Appellant again sent in the second installment of her premium over a week after the due date, and again Motorists accepted the payment and applied it retroactively, continuing her coverage from the payment’s due date.
Motorists points out that, in the instant situation, Appellant did not merely miss an installment payment and instead had let her auto insurance lapse. Even when Appellant allowed her policy to lapse completely, however, Motorists continued to accept her premium payments and issue retroactive insurance coverage. For instance, Appellant’s policy lapsed in December of 1989. Once Motorists informed her that her coverage had expired, she submitted another application and premium payment. Motorists accepted it, issuing a policy effective December 21, 1989—-the date Appellant tendered the premium. The same situation arose in June of 1990. After receiving notice from Motorists that her auto insurance had expired on June 21, 1990, Appellant tendered a $121.74 premium payment to Motorists on July 19, 1990. Motorists issued her a new policy, effective beginning July 19—the date Motorists received the premium. Both times, although the prior policies had lapsed, Motorists accepted Appellant’s premiums and issued her an insurance policy.
There is nothing different about the situation arising in January of 1991 that produced the current dispute. Appellant’s insurance coverage lapsed. Motorists informed her of the lapse and she subsequently tendered another premium. Appellant had reason to believe that Motorists would issue her a new policy, effective either from the date of submission or receipt of the premium, although her previous coverage had expired; after all, Motorists had done so twice before. Motorists’ prior actions left every indication that, if Appellant reapplied for insurance and submitted a premium payment, Motorists would extend her coverage beginning, at the latest, on the date Motorists received the payment. Motorists’ conduct in failing to inform her [528]*528otherwise amounts to a concealment of material facts.
Although Motorists argues vehemently that its “frequent lapse” policy should control, Motorists’ internal business practices are of no consequence here. In fact, the lack of notice of those practices to Appellant establish the second and third elements of es-toppel required by Gray. For estoppel to apply, the estopped party must be aware of the concealed material facts and those facts must be unknown to the other party. Gray, supra at 906. Left uncommunicated, Motorists’ decisionmaking procedures could have no effect on Appellant, a fact recognized by previous decisions.
In American Life and Accident Ins. Co. v. Clark, Ky., 407 S.W.2d 433 (1966), the insurer accepted premium arrearages for reinstatement of a lapsed life insurance policy. Between the company’s acceptance of the premiums and the expiration of the company’s internal waiting period for reinstatement, the insured died. After considering the insurance company’s attempt to deny coverage pursuant to its internal policy, this Court’s predecessor held that “[t]he rules of the company, uncommunicated to the insured, may not be used by the company as evidence against the insured, which would afford the insurance company to deny liabili-ty....” Id. at 435.
Similarly, in Equitable Life Assurance Soc’y v. Brewer, 225 Ky. 472, 9 S.W.2d 206 (1928), an insurance company retained a premium after a policy had lapsed, but later claimed coverage had not entered into effect until the company had completed certification of the insured’s good health. The insured lacked notice of the conditional effectiveness of the payment, a fact the Court held to be controlling: “When the payment of the premium was tendered after the grace period had expired, the company was not required to accept it; but when the company did accept it, it was incumbent on it to bring home to the insured any conditions it desired to impose.” Id. at 475, 9 S.W.2d 206.
The results reached in American Life and Equitable Life are, we believe, consistent with the requirements of equitable estoppel that the estopped party have knowledge of material facts of which the other party is unaware. Thus, when Motorists cashed Appellant’s check and retained the funds without giving her notice that, under its policies, it might refuse coverage, Motorists assumed the risk “of liability accruing before notice of the desired conditions was brought home to the assured.” Id. at 475-76, 9 S.W.2d 206.
Application of estoppel also requires that the estopped party “act with the intention or expectation his conduct will be acted upon.” Gray, supra at 906. In its opinion, the Court of Appeals held that “there is no evidence that Motorists intended for Howard to rely on its deposit of her check to create insurance coverage.” We believe that requiring the party seeking to invoke estoppel to show actual intent to mislead, though, asks too much. “It is not essential to the creation of an equitable estoppel ... that the party sought to be estopped should have had an actual intent to deceive, defraud, or mislead.” 28 Am.Jur.2d Estoppel and Waiver § 41 (1966). The fact that the party to be es-topped “should have known or had reason to believe or expect [his actions] would have such an effect” is enough. Id. We believe that the course of dealing here, where an insurer repeatedly accepted late payments and issued retroactive coverage, is sufficient to show that Motorists should have known or expected that Appellant would rely on the insurer’s representations.
Finally, the party seeking estoppel must detrimentally rely on the misrepresentation or concealment of material fact. The Court of Appeals also felt Appellant had failed to establish this element, holding that Motorists’ deposit of Appellant’s cheek did not cause her to suffer any detriment or change her position in any way. A review of Appellant’s deposition below, though, reveals otherwise. Appellant knew that Motorists had cashed her check, having received the can-celled check from her bank, and assumed that she had insurance coverage. Appellant testified that she would not have driven her car if she had known she had no insurance. Had Motorists informed her of the conditional nature of coverage, she might have asked for a refund of the premium. She might have sought insurance elsewhere. Instead, [529]*529due to Motorists’ actions—particularly its cashing of Appellant’s check—Appellant continued to drive, believing she had auto insurance. Only when she reported the accident did Appellant discover that Motorists had refused to insure her.
We believe the facts as detailed above establish the required elements of estoppel under Gray. Motorists engaged in a course of dealing where it repeatedly accepted late premiums, even if the policy had lapsed, and issued Appellant retroactive coverage. By cashing Appellant’s check and retaining the money for two weeks without informing her of the conditional nature of the acceptance, Motorists concealed material facts of which it was uniquely aware. While Motorists knew the true state of affairs, Appellant did not, and reasonably relied on the facts as she understood them, to her detriment. Accordingly, Motorists is estopped from denying coverage.
As a final matter, we address Appellant’s claim against Doetrow. Based on its decision on the coverage issue, the Shelby Circuit Court originally dismissed Appellant’s action against Appellee Doetrow as moot. The Court of Appeals, having reached a contrary result, reinstated the action. Doetrow did not file a cross-motion for discretionary review. Therefore, under CR 76.21, the Court of Appeals’ opinion decision reversing the dismissal of the action against Doetrow controls. See Nelson Steel Corp. v. McDaniel, Ky., 898 S.W.2d 66, 67 (1995).
For the foregoing reasons, the decision of the Court of Appeals is reversed and this case remanded to Shelby Circuit Court for proceedings consistent with this opinion.
STEPHENS, C.J. and GRAVES, LAMBERT and WINTERSHEIMER, JJ., concur.
COOPER, J., dissents by separate opinion, in which JOHNSTONE, J., joins.